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2021-12-30 Economy
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Cryptocurrency Prices Fall In December, and Investors Blame Omicron, Climate Change
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"Climate change" - is there anything it can't do?
[CNBC] KEY POINTS
* Investors have shifted away from riskier investments such as cryptocurrency due to the emergence of the Covid omicron variant.
* ESG investors are also concerned about the use of energy in cryptocurrency mining, according to Lou Kerner, partner at Blockchain Coinvestors.
* Cryptocurrencies tied to the metaverse, gaming and decentralized finance are also pulling investor interest and dollars away from bitcoin, ethereum and ripple, according to Brian Kelly of BKCM.
The rising number of cases of the Covid omicron variant in the U.S. are a major catalyst for the falling cryptocurrency prices in December, according to investors and analysts.
Ethereum is up more than 400% in 2021 but on pace for its worst month since March 2020 as investors reassess their exposure to riskier assets following the emergence of the omicron variant.
Bitcoin is on pace to double the S&P 500, and ripple is more than 200% higher year to date, but both are also down double digits this month.
"With omicron coming along and the U.S. economy stalling a bit, a lot of macro funds that use bitcoin as this pro-cyclical inflation hedge have decided to take profits throughout December," Brian Kelly, CEO and founder of digital currency investment firm BKCM, told CNBC.
ESG — or environmental, social and governance — investing and concerns over energy use have also been a catalyst in recent crypto declines, according to Lou Kerner, partner at Blockchain Coinvestors.
"Today ’proof of work’ from the [cryptocurrency] mining machines is looked upon negatively by a lot of the investment community because of the energy it consumes," Kerner told CNBC. "But if you dig deep, much of the energy is energy that couldn’t be used for anything else. Relative to the massive value we are getting from it, the energy I think will become much less of a concern next year."
This 'energy' is commonly called electricity, and how on Earth it relates to "climate change" doesn't even come close to reaching the level of tenuousness. The sheer level of arrogance of stating electricity can't be used elsewhere demonstrates a fundamental lack of seriousness on at least one party here. I'd rather these analysts say 'I don't know' than to pull yet something else outta their collective asses. 
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Posted by Raj 2021-12-30 00:00||
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